The cheapest 2018 iPhone has fallen short of sales expectations

People familiar with the matter told the Wall Street Journal that the tech giant plans to launch three new smartphones this fall, including a successor to the XR, Apple’s cheapest 2018 device that has fallen short of sales expectations.

All three models are expected to introduce new camera features, including a triple rear camera for the highest-end model and double rear cameras to replace single rear lenses for the two other launches. Interestingly, the sources added that the new budget smartphone will once again use a liquid-crystal display (LCD), even though the XR’s screen resolution was widely criticized.

Sources said Apple is persisting with LCD because the planned handset has been in the pipeline for months and it is difficult to change course at this late stage. However, from next year LCD models could be shelved entirely, the sources added, paving the way for all new iPhones to use more expensive organic light-emitting diode technology.

News of Apple’s latest product assault came shortly after the company warned that iPhone sales underwhelmed expectations. On Jan. 2, the tech giant issued its first revenue warning in nearly 12 years, blaming most of its difficulties on poor demand in China.

In a letter to shareholders, CEO Tim Cook claimed that the country’s economy had been affected by rising trade tensions with the U.S. and that jittery consumer sentiment had a particularly marked impact on smartphone sales. Apple earns 20% of its revenues in Greater China.

Reports have since surfaced that Chinese retailers are now aggressively discounting iPhones in a desperate attempt to offload them to customers. Experts told CNBC that consumers have been shunning Apple’s smartphones because they cost too much and don’t include enough innovative features, compared to local competitors such as Huawei. The Nikkei Asian Review recently reported that the company slashed production of its 2018 iPhone models by about 10% for the January-March quarter

Apple now faces a huge challenge to convince the important Chinese market that it’s 2019 iPhones will be worth buying.

The Wall Street Journal’s sources pointed out that the 2019 models are not unlikely to feature any striking changes as their development is now too far advanced. That means that customers might have to wait until 2020 to see how Apple responds to weak demand for its 2018 batch of iPhones.

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